Prudential clutches Egg
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Decision to sell off Internet bank reversed.
26 October 2005 Insurance group Prudential has called off its two-year hunt to find a buyer for its stake in the online bank Egg, and will now focus renewing its Internet strategy.
As part of a fundamental rethink of corporate strategy, Prudential executives have confirmed that it will retain its 79% stake in Egg, and intends to integrate its banking, insurance and fund management decisions.
The decision follows a major review of strategy prompted by the removal of Jonathon Bloomer as CEO in May 2005. His replacement, Mark Turner, now sees Egg forming a crucial part on linking up its various assets.
"We see opportunities for greater collaboration allowing us to capitalise on the strong positions we have in different areas of the market," Mr Tucker said.
Better management of IT and administrative functions would allow the group to cross-sell Prudential insurance products and savings products across it groups to Egg customers, he added.
The search for a buyer started in 2003 after a disastrous foray into France which cost Prudential €280m and generated just 133,000 customers.
Egg recently reported a rise in UK profits for the quarter ending 30 September - up 29% to £17.8 million, compared to £13.1 million in the same quarter a year ago.
"We have been participating in Prudential's ongoing strategic review and we are looking forward to working more closely together," said Paul Gratton, CEO at Egg.
